Every business looking for real-time or high-intelligence capabilities will need to take the services of a cloud provider. Be sure to go beyond the dazzling saying of contracts to get the real story of exactly how the vendor intends to charge your business.
For having access to the latest technology and virtually unlimited capacity needed for real-time applications and streaming, cloud is the way to go, and there are many cloud services to facilitate any and all requirements. However, cloud vendor contracts are fraught with legalizing landmines that could cause many businesses to end up on the short end of the stick. In addition, there are often misconceptions about pricing-for example, cloud subscriptions don’t offer a “pay by drink” option, they are often provided with fixed monthly fees, at the same way like traditional software in place.
The gotchas and grabs entrenched in complex cloud contracts emerged in a work by Adam Mansfield, head of training of Microsoft, Salesforce, and ServiceNow consulting services at UpperEdge. In his eBook, The Ultimate Guide to Cloud Subscriptions Agreements, Mansfield reminds us that no deal is set in stone, and corporate cloud subscribers have some chance at what they can discuss. “Companies using cloud applications should approach their cloud agreements with proper rigor and make sure they include the necessary upfront and downstream protections as well as flexibility while also addressing the various concerns in security, ”he said.
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It’s important to negotiate on terms that “make sure you don’t pay for‘ air, ’” Mansfield explains. “In many instances, fixed commitments for specified numbers of users create a frightening shelfware effect. Businesses forced on initial commitments buy more user software licenses than necessary. “In cloud agreements,” the business has no license to leave and use later. When an enterprise enters into a cloud subscription agreement, they lease access to the functionality. “
Remember, from the vendor’s perspective, what they want above all is a sure and predictable revenue stream. Here are some guidelines for negotiating a cloud agreement:
What to do about pricing: “Cloud subscription agreements are often vague about the protections against price increases applied to any additional products or users added during the term,” Mansfield said. Make it clear that adding additional products or users will be subject to the original pricing agreement. In addition, beware of price increases at the time of renewal-start a preliminary contract with limits on future price increases.
What to do about downtime: Who is responsible when systems slow down or go down? Be precise on the parameters for service level agreements, Mansfield says. “Once downtime starts, the clock needs to start ticking in terms of downtime calculation.” In addition, there needs to be “clear and specific penalties defined and enforced.”
What to do with the data: When it comes to data ownership and management, “common cloud agreements are unclear at best,” Mansfield warns. “Customers must retain full ownership and have access to their data at all times. In particular, companies should ensure that they get a complete copy of their data from cloud vendors, upon written request. Back-up, encryption, and data disposal processes should also be mentioned in advance in case there is a litigation or termination in the future.
What to do when things are done: “The vendor’s obligations at the end need to be clearly stated,” Mansfield said. When it comes to data, “at a minimum, in the end, the data should be returned to the customer in both a vendor data format and a platform-agnostic format. Once the successful removal of that data is confirmed, all customer data on all vendor servers must be permanently removed. “
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Every business looking for real-time or high-intelligence capabilities will need to take the services of a cloud provider. Be sure to go beyond the dazzling saying of contracts to get the real story of exactly how the vendor intends to charge your business, and how deeply it takes responsibility for the performance of your applications.